Abstract

In a circular economy, finding alternatives for sustainable production, consumption, and work lines that prioritize human health and reduce the use of natural resources can also reduce the pressure of production on environment and health. At this point, it is very important to analyze the human health related consequences of linear production processes and ensure that market prices internalize externalities related to healthcare costs. In this study, the effects of industrial production and economic growth on healthcare expenditures is analyzed for Turkey. In addition, the negative effects of pollution from current linear production models and the use of natural resources on health are examined. The study aims to question and discuss the GDP calculation methods that do not include these negative externalities. The long-term relationship between healthcare expenditures, industrial production, and economic growth in Turkey were examined with a boundstest. The short-term and long-term flexibilities were determined with EKK and DOLS methods. The findings revealed that there is a long-term relationship between healthcare expenditures, industrial production, and the GDP in the period examined. In addition; the estimation results showed that there is no significant relationship between industrial production, the GDP, and healthcare expenditures in the short-term, but changes in industrial production and the GDP in the long-term affected healthcare expenditures positively. Therefore, this study demonstrated that an increase in industrial production along with economic growth caused an increase in healthcare expenditures. In other words, industrialization and production activities in Turkey causes negative externalities related to the environment and hence health.

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